Clive Betts – The Negotiatorhttps://thenegotiator.co.uk
The essential site for residential agentsThu, 16 May 2019 21:13:47 +0000en-GB
hourly
1 Competition regulator to launch investigation into leasehold mis-sellinghttps://thenegotiator.co.uk/competition-regulator-to-launch-investigation-in-leasehold-mis-selling-scandal/
https://thenegotiator.co.uk/competition-regulator-to-launch-investigation-in-leasehold-mis-selling-scandal/#respondThu, 16 May 2019 23:01:39 +0000https://thenegotiator.co.uk/?p=54466CMA says it may take enforcement action against developers or managing agents found to have contravened consumer protection laws.

Developers and managing agents may be feeling nervous at the moment after the Competition & Markets Authority (CMA) yesterday revealed that it is to launch an investigation in to the mis-selling of leasehold properties.

The news was broken by CMA Chief Executive Andrea Coscelli in a letter to MP Clive Betts, who chairs the Housing, Communities and Local Government Select Committee.

In it Coscelli (pictured, left) said the CMA’s investigation “may in due course lead to our bringing enforcement proceedings if the evidence we uncover would warrant that”.

“We acknowledge the significant concerns that the Committee has raised about leasehold mis-selling, and whether leasehold contract terms are unfair in relation to, for example, ground rent and permission charges,” he said.

The letter referred to the Committee’s recent report on the leasehold system, which heavily criticised the way that leasehold houses have been sold by developers.

But it also said many apartment leaseholds were unfair too and that overall the system left home owners open to abuse.

Its report also said the problems it discovered included onerous ground rents, high and opaque service charges and one-off bills, unfair permission charges, imbalanced dispute mechanisms, inadequate advisory services, and unreasonable costs to enfranchise or extend leases.

Not transparent

NAEA Propertymark produced its own report on the leasehold scandal last year, which found that 62% of those buying leasehold homes felt they had been miss-sold the property.

Mark Hayward, Chief Executive, says: “We welcome the investigation by the CMA into the mis-selling of leasehold properties as for too long housebuilders and developers have not been transparent enough about what it actually means to buy a leasehold property.”

]]>https://thenegotiator.co.uk/competition-regulator-to-launch-investigation-in-leasehold-mis-selling-scandal/feed/0Tenant Fees Bill – MPs unanimously vote through second readinghttps://thenegotiator.co.uk/mps-vote-through-2nd-reading-of-tenant-fees-bill/
https://thenegotiator.co.uk/mps-vote-through-2nd-reading-of-tenant-fees-bill/#respondMon, 21 May 2018 19:00:03 +0000https://thenegotiator.co.uk/?p=39985Letting agents hoping for a miracle defeat for the Tenant Fees Bill last night in the Commons during its second reading were disappointed when it was passed unanimously by MPs following a three-hour debate. Although 123 MPs are landlords, only two pointed out any failings in the legislation that might have given letting agents hope. ...

Letting agents hoping for a miracle defeat for the Tenant Fees Bill last night in the Commons during its second reading were disappointed when it was passed unanimously by MPs following a three-hour debate.

Although 123 MPs are landlords, only two pointed out any failings in the legislation that might have given letting agents hope.

These were Labour’s Andrew Lewer and Conservative Alex Chalk, both of whom asked that not all agents should be tarred with the same ‘rogue’ brush and that the bill could prompt higher rents.

“There are hard-working people in this sector and we shouldn’t punish the unscrupulous at the expense of the far more numerous hard-working ones,” said Lewer (pictured, right).

Default fees

But all of the dozen or more other speakers were in support of the bill’s aims, many on both sides of the political divide calling for it to be tightened up particularly in relation to ‘default fees’.

“Rogue letting agents have for too many years been able to profit from unsecure tenancies,” said Dr Paul Williams.

Default fees are one of the few fees agents will be able charge soon and will be permissible only when a tenant prompts work, for example if they ask for changes to a contract, leave a tenancy early or lose their keys.

Deposits

One other area of intense debate during the second reading was the six-week deposit ceiling; many speakers said it would persuade agents and landlords to ‘go to the max’ above the current average industry standard of four weeks.

Also, many of those involved in the debate worried that any ‘grey areas’ would be exploited by unscrupulous or rogue letting agent to generate replacement fees.

Free market

One sign of how far the Tory party has come on fees reform was free marketeer John Stevenson MP (right), who said that although he preferred markets to be unfettered, it was now the right time to introduce reform.

But he warned it should not prevent competition between agents – a point ARLA has often made.

Letting agents hoping that MPs would accept industry arguments that agents do a lot of work for tenants and should therefore charge them were dashed.

“The good letting agents will accept this legislation and comply with it,” said Clive Betts, who is also chair of the housing select committee.

He also called for the government to look into the growing provision of insurance-based deposits services such as Zero Deposit and others.

Brighton

The most contentious speech was made by Brighton MP Lloyd Russell-Moyle (pictured, right), who claimed “most” agents in his city are involved in ‘sharp practices’ and that all holding deposits in Brighton start at £500.

But one glimmer of hope for agents came from MP Richard Graham, who said he believed the legislation mirrored existing changes within the lettings industry.

“The role of agents is changing from one of intermediary in an analogue age to a landlord’s compliance department in the digital age,” he said.

Industry reaction so far

“The tenant ban is a positive move by the government and removes unnecessary costs to tenants at a time where they are outlaying large costs” says Mark Readings, MD of online agent House Network (pictured, right).

“We do not charge tenants fees [and] if the majority of the industry follows suit, then it is the letting agents who suffer the revenue loss rather than the landlords, and as such, should not result in rent increases.

“Letting agents work in an extremely competitive marketplace and the tenant ban legislation will enable new business models to come into the market – the high street agents will have to overcome a revenue shortfall and this could boost the market share of online agents further.

“The government have admitted that it could cost letting agents between £1bn – £4bn over the first 10 years and as such could effect job losses within the industry – however, the most productive letting agents will overcome this change and the market will be a fairer place for the consumer, which we fully support.”

]]>https://thenegotiator.co.uk/mps-vote-through-2nd-reading-of-tenant-fees-bill/feed/0Letting agents must ‘stop encouraging longer tenancies’https://thenegotiator.co.uk/letting-agents-longer-tenancies/
https://thenegotiator.co.uk/letting-agents-longer-tenancies/#respondSun, 22 Apr 2018 23:01:19 +0000https://thenegotiator.co.uk/?p=38690Read how a leading MP and Select Committee chair has called for lettings agents to stop encouraging longer tenancies within the PRS.

Landlords are being persuaded by letting agents into changing tenants too often and should instead embrace longer tenancies, an influential MP has said.

The comments were made by Clive Betts (pictured below), chair of the influential parliamentary Select Committee that scrutinises the Ministry for Housing, Communities and Local Government, during a debate in Parliament.

“Landlords should get a bit wise to this, because I think many would actually favour longer tenancies,” he said.

“Let us get the information out there and encourage it.”

MP and Chair of estate agent Hunters, Kevin Hollinrake (pictured, below), who exempted himself from working on the report because of his industry interests, said he worried that a move to encourage longer tenancies would drive landlords out of the sector and reduce “supply to this very, very important sector”.

But Betts also revealed during the debate that many local authorities are unable to police housing because council enforcement budgets have been cut by a sixth over the past five years.

His comments came during a robust debate in Parliament about the Select Committee’s recent report into the PRS during which he revealed that its report’s recommendations were designed to give more power to tenants.

He also highlighted how 14% of them feel they were penalised for complaining and that 200,000 had been abused by their landlord.

Letting agents

“We found that there is a clear power imbalance, and we called on the Government to consider extending protections which they rightly introduced in the Deregulation Act 2015,” he says.

“We also agree with the Government that a specialist housing would provide a more accessible route to redress for tenants and urge them to issue more detailed proposals as soon as possible.”

Betts also said the government’s attempts to educated tenants about their rights through leaflets are not getting through to today’s Millennials, and that social media such as Twitter, Facebook and Instagram should be used more.

]]>https://thenegotiator.co.uk/letting-agents-longer-tenancies/feed/0Fit for human habitation legislation passes second hurdle in Parliamenthttps://thenegotiator.co.uk/bill-fit-for-human-habitation-bill/
https://thenegotiator.co.uk/bill-fit-for-human-habitation-bill/#respondMon, 22 Jan 2018 00:58:33 +0000https://thenegotiator.co.uk/?p=34430A bill requiring landlords and agents to ensure rental properties are fit for human habitation and enabling tenants to chase them for compensation when they don’t maintain them took its second step through the House of Commons on Friday. The Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill passed its second reading ...

]]>A bill requiring landlords and agents to ensure rental properties are fit for human habitation and enabling tenants to chase them for compensation when they don’t maintain them took its second step through the House of Commons on Friday.

The Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill passed its second reading in Parliament during an hour-and-a-half long debate lead by the bill’s sponsor Karen Buck, MP for Westminster North (pictured, above).

Her bill, for the first time, frames what ‘fit for human habitation’ means and outlines the new regulations that agents will have to ensure properties stick to.

Landlords and agents already have to ensure properties are not kept in a state of ‘disrepair’ but now ‘unfit’ will cover issues such as fire safety, inadequate heating, poor ventilation, condensation and mould.

At the moment landlords and agents are only obliged to repair the structure of a property when it’s broken or damaged, but when the bill becomes law most likely later this year, they will have wider responsibilities for the condition of the property.

Fit for human habitation

The debate included contributions from Clive Betts MP (pictured, right), who also chairs the Ministry of Housing, Communities and Local Government Select Committee, as well as Bob Blackman and Lucy Allen. She revealed that her Telford constituency had a long history of “private rental property which had been neglected”.

Karen Buck was praised for her tenacity in bringing the bill to the house, and gaining cross-party support for it. It was also revealed that poor quality housing costs the NHS £1.4 billion a year.

Despite the good cheer, there were several conflicting statements made including that although “the vast majority of landlords act responsibly”, one in six privately rented properties are not fit for human habitation.

“In future tenants will be able to act against landlords to force them to take remedial action, and obtain compensation when they do not,” Karen Buck said during her speech.

During the debate it was said by another MP that the bill was “well balanced because it gives tenants new rights, but also offers safeguards for landlords”.

]]>https://thenegotiator.co.uk/bill-fit-for-human-habitation-bill/feed/0MPs lead inquiry into rogue landlords and selective licensinghttps://thenegotiator.co.uk/rogue-landlords-communities-and-local-government-committee/
https://thenegotiator.co.uk/rogue-landlords-communities-and-local-government-committee/#respondFri, 13 Oct 2017 07:41:09 +0000https://thenegotiator.co.uk/?p=31639An inquiry is to be held in parliament into how well local authorities are policing rogue landlords and how effective the much-criticised selective licensing schemes have been in curtailing bad practices. Announced by the Communities and Local Government select committee, the inquiry will examine several key issues within the private rented sector including whether councils ...

]]>An inquiry is to be held in parliament into how well local authorities are policing rogue landlords and how effective the much-criticised selective licensing schemes have been in curtailing bad practices.

Announced by the Communities and Local Government select committee, the inquiry will examine several key issues within the private rented sector including whether councils should do more to provide affordable private rented accommodation, whether they have enough powers to deal with rogue landlords and what’s preventing proper policing of the privately rented homes sector.

The Committee will also look at how effective the complaints system is for tenants.

The inquiry’s terms of reference are very similar to a key report by the Adam Smith Institute published three years ago, which found that 52% of councils activity promoted the private rented sector through their local plans, but only 2% said it was their top housing priority.

Bad landlords

“With a big rise in the number of people renting over the last decade, there are real concerns about the ability of local authorities to protect tenants by tackling bad landlords and practices,” says the committee’s Chair Clive Betts MP.

“Our inquiry will examine how local authorities can carry out enforcement work to deal with rogue landlords as well as looking at approaches used by councils to provide private rented accommodation in their areas.”

The scope of the inquiry mirrors several points made by DCLG minister Sajid Javid during his speech at last week’s Conservative Party conference.

At the conference Sajid said proposals would be brought forward to compel all landlords to join a national redress scheme to enable tenants to complain about poorly-managed properties and rogue landlords, and a housing court where tenant grievances would be arbitrated.

“NALS has called for greater enforcement across the PRS for some time and launched an Enforcement Toolkit last year specifically to support local authorities.

“For too long rogue operators have slipped under the enforcement radar, so focussing on measures to address this situation is a positive move by Government. Coupled with the promise of increased regulation and the introduction of mandatory CMP, we can see that steps are starting to be put in place to create a very different PRS in the future; one that is fairer for all.”

The CLG Committee has ten members including former housing minister Mark Prisk and Hunters founder Kevin Hollinrake.

Individuals and organisations wishing to send in a written response have until 24th November to complete their submissions online.

]]>https://thenegotiator.co.uk/rogue-landlords-communities-and-local-government-committee/feed/0Tenant fees ban WILL drive up rents and lower property standards, MPs are toldhttps://thenegotiator.co.uk/tenants-fees-ban-will-drive-up-rents-and-lower-property-standards-mps-are-told/
https://thenegotiator.co.uk/tenants-fees-ban-will-drive-up-rents-and-lower-property-standards-mps-are-told/#commentsTue, 09 Jan 2018 08:19:01 +0000https://thenegotiator.co.uk/?p=34037MPs put the new housing minister Sajid Javid’s tenant fees ban legislation under scrutiny last night, and it was proven to be lacking on several fronts. Landlords are likely to increase their rents across the tenancy to pay the extra costs of running a tenancy, something the new law can’t stop, and that there is ...

]]>MPs put the new housing minister Sajid Javid’s tenant fees ban legislation under scrutiny last night, and it was proven to be lacking on several fronts.

Landlords are likely to increase their rents across the tenancy to pay the extra costs of running a tenancy, something the new law can’t stop, and that there is a substantial risk local councils will impose unjustifiably high fines on agents and landlords to finance enforcement, in the absence of government support, it was claimed.

The other key criticism made during the session was that the draft bill is likely to be self-defeating – lower fees will mean letting agents are less incentivised to help landlords run their properties professionally.

These views were all the more surprising given they came from experts from the policy end of the sector, not agents.

The two-hour long session was held by the parliamentary committee that oversees Sajid’s department, the Select Committee that oversees the newly renamed Department for Housing, Communities and Local Government.

Tenant fees ban

Headed up by MP Clive Betts plus 11 other MPs, it quizzed three experts in the field about how effective the bill will be.

These were Shelter’s Head of Policy Kate Webb, the University of York’s Centre for Housing Policy Dr Julie Rugg and Professor Ian Loveland from the City Law School.

Several debates raged during the hearing including whether the bill was legally watertight enough, whether councils will have the resources to police it (they won’t, the experts said), weaknesses in the role of the new housing tribunal, the high level of fines – remember agents and landlords face paying up to £30,000 if they are caught flouting the new law – and whether the bill will drive the quality of rented properties down as landlords seek to save money.

Shelter’s Kate Webb (pictured, left) also claimed controversially that the poorer the tenant, the higher the fees letting agents charge them, while Ian Loveland picked numerous holes in the bill’s drafting, which he suggested was not robust enough to withstand legal challenges given the huge fines involved.

The MPs also debated how letting agents should be fined – and whether it should be based on the additional fees levied on a single property illegally or whether the bill should look at their whole portfolio and then fine them accordingly.

The draft Tenants’ Fees Bill will now go to report stage before a third reading.